Gambling Commission - Industry statistics /09/10/11. Industry statistics. April 2008 to March 2011

Transcription

1 1 08/09/10/11 Industry statistics April 2008 to March 2011

2 2 Contents Gambling industry data 4 Betting 9 Bingo 17 Casinos 22 Gaming machines, including arcades 27 Lotteries 31 Remote betting, bingo and casino 33 Appendix 1 - Regulatory returns analysis 37 Appendix 2 - Terminology 38 Appendix 3 - Useful contacts 39

3 3 Preface 1. These detailed statistics relating to the gambling industry in Great Britain have been collated by the Gambling Commission (the Commission) from regulatory returns required to be submitted by all licensed operators, other information provided by operators and information provided by trade bodies, regulatory partners and by a commercial provider. 2. This report provides statistics covering three 12 month periods: 1 April March April March April March Some figures will be representative of the position at 31 March of the year concerned or reflect an average of values for dates falling within each 12 month period; whichever is the case is stated in the table. 3. All regulatory returns due for the periods 1 April March 2009 and 1 April March 2010 should have been submitted. Accordingly those figures are correct as of the date of publication, although may be subject to further minor change arising from overdue returns or identification of errors made in submissions. The figures provided for 1 April March 2011 are provisional, and therefore subject to amendment within future industry statistics publications, because: a) not all returns for the period are due to have been received b) in some instances, estimations have been necessary c) some returns are subject to outstanding queries with operators. 4. The Commission s methodology for providing annualised figures based on operators returns is included in appendix The information contained in this document covers domestic British gambling markets (betting, bingo, casinos, arcades, gaming machines, lotteries) and remote gambling. It does not cover the National Lottery or spread betting, as those activities are not regulated by the Gambling Commission. 6. The terminology used in this document is explained in appendix Totals and percentages are calculated from unrounded figures. 8. Further statistics and information relating to the Commission and its activities are contained in the Commission s annual reports and licensing authority statistics publications, available on the Commission website at:

4 4 Gambling industry data Introduction Market size During the period April 2010 to March 2011 the British gambling industry, as regulated by the Commission, generated a gross gambling yield (GGY see appendix 2) of 5.5 billion. This reflects only a marginal change compared to the same period the previous year. The non-remote betting sector represents the largest market within the industry with a 53% share, followed by the casino sector (14%) and the British regulated remote sector (12%). However, most British consumer remote gambling activity is on overseas regulated sites. As an example, estimates put the UK consumer market at 1.9 billion for 2010, approximately three times the size of the British regulated remote market. 1 Fig 1: Market share by GGY April 2010 to March 2011 Casino 14% Remote 12% Bingo 11% Arcades 7% Betting 53% Lottery 3% Table 1: GGY comparisons across all gambling sectors Sector Gross gambling yield Non-remote sector 4, , , % Arcades % Betting 2, , , % Bingo % Casinos % Remote betting, bingo and casino % gambling 2 Lotteries (remote and non-remote) % Total 5, , , % 1 The Northern Ireland consumer market represents a small proportion of the UK total. 2 As regulated by the Commission.

5 5 Table 2: Gaming machine numbers across all gambling sectors Machine category Average number of machines B1 2,477 2,441 2,477 1% B2 31,484 31,968 32,007 0% B3 12,702 12,706 11,556-9% B % C 60,580 52,399 45,476-13% D 49,215 46,722 42,894-8% Grand total 157, , ,840-8% As the Commission does not license pubs, clubs, working men s clubs or FECs operating under a local authority permit, we do not collect regulatory returns for those businesses. The table does not, therefore, represent activity in those sectors. Table 3: Gaming machine GGY across all gambling sectors Machine category B % B2 1, , , % B % B % C % D % Totals only* % Grand total 1, , , % * Where GGY figures have been provided but not broken down by machine category. As the Commission does not license pubs, clubs, working men s clubs or FECs operating under a local authority permit, we do not collect regulatory returns for those businesses. The table does not, therefore, represent activity in those sectors. Table 4: Number of employees across all gambling sectors* Sector Head count Betting 60,247 55,496 54,311-2% Bingo 15,917 15,443 14,952-3% Casino 13,321 13,619 13,598 0% Arcades 16,499 16,254 13,836-15% GM Manufacturer 1,662 2,005 1,800-10% GM Supplier 8,205 6,673 6,159-8% Lotteries (ELM) % Remote (FTE only) 8,918 7,216 6,077-16% Total 125, , ,363-5% *Includes full-time and part-time posts.

6 6 Gambling participation and problem gambling prevalence Participation in gambling activities (British Gambling Prevalence Survey 2010) The British Gambling Prevalence Survey 2010 (BGPS), carried out by NatCen on behalf of the Commission, sampled 7,756 adults between November 2009 and June The report was published in February It showed that 73% of the adult population (about 35.5 million adults) had participated in some form of gambling activity within the past year. Excluding people who had only gambled on the National Lottery in the past year, 56% of the population had participated in another form of gambling in the past year. The most popular gambling activities in Britain in 2010 were the National Lottery (59% had participated in the past year), other lotteries (25%), scratchcards (24%), betting on horse races (16%), playing slot machines (13%) and private betting (11%). Less than one in ten adults took part in each other activity. In the past year 4% of adults had bet online, a greater proportion of adults (13%) had used the internet to participate in other online gambling (ie the National Lottery and its related products, other lotteries, bingo, football pools, casino style games or online slot machine style games). Table 5: Gambling activities in the past year (British Gambling Prevalence Survey 2010) Type of gambling activity Percentage of respondents (%) National Lottery Draw 59 Another lottery 25 Scratchcards 24 Football pools 4 Bingo 3 9 Slot machines 13 Fixed odds betting terminals 4 4 Horse races 5 16 Dog races 5 4 Sports betting 5 9 Betting on non-sports events 5 4 Casino games 6 5 Poker at a pub/club 2 Online slot machine style games/instant wins 3 Spread betting 1 Private betting 11 Any online betting 7 4 Any other online gambling 8 13 Any gambling activity 73 Participation in gambling activities (omnibus survey results) The Commission has been using a quota sample omnibus survey to provide information on participation in gambling for a number of years. We currently commission two separate but complementary sets of questions in telephone omnibus surveys (conducted by ICM Research); one measuring participation in all types of gambling, and one which monitors participation solely in remote gambling. 3 Includes bingo played at a club or online (the prevalence of playing bingo online was less than 1%). 4 B2 gaming machines. 5 Includes bets made online, by telephone, or in person, with a bookmaker or a betting exchange. 6 Includes casino games (such as roulette, poker, blackjack) played in a casino or online (prevalence rates of playing casino games online in the last year was 3% overall). 7 Includes online bets on horse races, dog races, other sports or non-sports events, with a bookmaker or betting exchange. 8 Includes using the internet to play the National Lottery, other lotteries, bingo, football pools, casino games, online slot machine style games.

7 7 The data is published each quarter, based on a rolling sample of interviews conducted over the previous year. As the omnibus surveys ask whether respondents have gambled in the past four weeks, the results obtained are not directly comparable with those of the BGPS 2007 or BGPS 2010 which look at respondents gambling activity over the past week and past year. Participation in all gambling activities In the year to March , 56.2% of the 5, adults surveyed said they had participated in at least one form of gambling in the previous four weeks. This figure of 56.2% compares with the 2010 calendar year figure of 55.5%, and the 2009 calendar year figure 11 of 55.2%. Table 6: Proportion of respondents participating in at least one form of gambling (survey data on gambling participation) Gambling participation Year to March 2011 All respondents 55.2% 55.5% 56.2% In the year to March 2011, the most popular gambling activity was National Lottery tickets (46.0% of respondents), followed by tickets for society or other good cause lotteries (11.4%) and National Lottery scratchcards (10.3%). Betting on horse races, the football pools, and fruit or slot machines were the next most popular activities (4.0%, 3.1% and 3.0% respectively). Table 7: Proportion of respondents gambling by type of gambling activity (selected activities) (survey data on gambling participation) Gambling activity (selected) Year to March 2011 National Lottery tickets 45.7% 45.5% 46.0% National Lottery products only (not participating in any other gambling activity) 31.3% 31.4% 32.1% Tickets for society or other good cause lotteries 10.9% 12.2% 11.4% National Lottery scratchcards 10.8% 10.2% 10.3% Betting on horse races or virtual horse races with a bookmaker (does not include online) 3.4% 3.7% 4.0% The football pools 3.1% 2.8% 3.1% Fruit or slot machines 3.3% 2.8% 3.0% Participation in remote gambling In the year to March 2011, 11.2% of the 5, adults surveyed said they had participated in at least one form of remote gambling in the previous four weeks. Around half of these had participated only in National Lottery products. This figure of 11.2% compares with the 2010 calendar year figure of 11.1%, the 2009 calendar year figure of 10.5%, the 2008 calendar year figure of 9.7%, the 2007 calendar year figure of 8.8% and the 2006 calendar year figure of 7.2%. 9 As the omnibus survey results are published quarterly, more up-to-date information is available on our website at 10 From September 2010, each set of questions are asked of 1,000 (and not 2,000) respondents per quarter. 11 Questions measuring participation in all gambling activities were first introduced in 2009 (following initial trials in 2008), therefore the earliest available complete calendar year for this dataset is 2009.

8 8 Table 8: Proportion of respondents participating in at least one form of remote gambling (survey data on gambling participation) Gambling participation Year to March 2011 All respondents 7.2% 8.8% 9.7% 10.5% 11.1% 11.2% The growth in participation in remote gambling between 2006 and 2011 is explained very largely by increased online participation in the National Lottery. If those only playing National Lottery products remotely are excluded, 5.9% of respondents had participated in remote gambling in the year to March 2011, compared with 5.7% in 2010, 5.7% in 2009, 5.6% in 2008, 5.2% in 2007 and 5.1% in Table 9: Proportion of respondents participating in remote gambling in the past four weeks, excluding those only playing National Lottery products (survey data on gambling participation) All methods of remote gambling Those participating in at least one form of remote gambling (excluding those only playing National Lottery products) as a percentage of all respondents Year to March % 5.2% 5.6% 5.7% 5.7% 5.9% Overall, in the year to March 2011, 8.6% of respondents said they had remotely purchased tickets for the National Lottery draw in the previous four weeks (either exclusively or in addition to other types of gambling activity). Remote gambling via a computer, laptop or handheld device was most popular (9.8% of all respondents), followed by gambling via mobile phone (3.1%) and interactive/digital TV (1.4%). Table 10: Proportion of respondents gambling using different remote methods in the past four weeks (survey data on gambling participation) Methods of remote gambling Internet through a PC, laptop or handheld device WAP/internet or text (SMS) on a mobile phone Year to March % 6.9% 7.8% 9.1% 9.9% 9.8% 2.2% 2.5% 2.9% 2.8% 2.9% 3.1% Interactive/digital TV 1.7% 1.8% 2.1% 1.9% 1.4% 1.4% Problem gambling The BGPS 2010 measured the levels of problem gambling in the adult population in Great Britain using two internationally recognised scales, the Diagnostic and Statistical Manual of Mental Disorders 4th edition (DSM IV), and the Canadian Problem Gambling Severity Index (PGSI). This allowed us to check for reliability within our survey and to compare our findings with those found in similar studies around the world. The DSM IV screen found that the rate of problem gambling in the adult population was 0.9% 12 which equates to about 451,000 adults. This figure was higher than that reported in 2007 and 1999 (0.6% for both years). This increase is at the margins of statistical significance. The PGSI screen identified 0.7% 13 of the adult population with a gambling problem, or around 360,000 adults. This does not constitute a statistically significant increase on the BGPS 2007 figure. 12 Confidence interval 0.7%-1.2% 13 Confidence interval 0.5%-1.0%

9 9 Betting Structure of the non-remote betting industry The non-remote betting industry is made up of both on-course and off-course betting operators. As at 31 March 2011, there were 531 licences held by operators for the activity non-remote general betting standard (off-course) and 670 for the activity non-remote general betting limited (on-course). During 2010/11 the betting industry was heavily concentrated amongst five operators that, as at 31 March , accounted for 83% of all betting shops. The numbers of betting shops in Great Britain operated by each of these operators is as follows: Table 11: Number of premises by operator Organisation Total betting shops As at 31 As at 31 As at 31 William Hill 2,228 2,263 2,350 Ladbrokes 2,080 2,073 2,097 Gala Coral Group 1,630 1,645 1,712 Betfred Tote Other 1,600 Approx 1,500 1,554* Total 8,862 Approx 8,822 9,067 * During 2010/11 the Commission requested gambling premises data from all licensing authorities in Great Britain in order to update its location database. All but 14 licensing authorities responded and this information is used here where previously the Commission has published only estimates. All other figures are obtained directly from operators. General information about the betting industry The gross gambling yield generated by the British non-remote betting sector increased by 5% during 2010/11 compared to the previous 12 months. This was driven largely by a 10% increase in revenue from gaming machines. At the same time GGY reduced for on-course betting, as did the total number of betting sector employees (-2%). Employees Table 12: Betting sector employees Average number of employees 60,247 55,496 54,311-2% 14 Figures for the major five bookmakers were obtained from the companies concerned. 15 The Tote has now been purchased by Betfred.

10 10 Off-course betting Table 13: Off-course betting turnover Type Turnover Dogs 1, , , % Football , % Horses 5, , , % Numbers % Other % Total 9, , , % Fig 2: Off-course betting turnover Other Numbers Horses Football Dogs Table 14: Off-course betting GGY Type Gross gambling yield Dogs % Football % Horses % Numbers % Other % Total 1, , , %

11 11 Fig 3: Off-course GGY Other Numbers Horses Football Dogs Table 15: On-course betting turnover Type Turnover Dogs % Horses % Other % Total % Fig 4: On-course betting turnover Other Horses Dogs

12 12 Table 16: On-course betting GGY Type Gross gambling yield Dogs % Horses % Other % Total % Fig 5: On-course betting GGY Other Horses Dogs Table 17: Pool betting turnover Type Turnover Dogs % Football % Horses % Other % Total %

13 13 Fig 6: Pool betting turnover Other Horses Football Dogs Table 18: Pool betting GGY Type Gross gambling yield Dogs % Football % Horses % Other % Total % Fig 7: Pool betting GGY Other Horses Football Dogs

14 14 Gaming machines in betting shops Table 19: Average gaming machine numbers 16 Machine category Table 20: Gaming machine GGY 17 Machine category Gross gambling yield B2 1, , , % B % B % C % D % Aggregated categories* % Total 1, , , % * Where GGY figures have been provided but not broken down by machine category. Table 21: Off-course betting sector breakdown of GGY Type Average number of gaming machines and terminals Gross gambling yield B2 31,439 31,936 31,978 0% B % B % C % D % Total 32,022 32,353 32,340 0% Over the counter (OTC) 1, , , % Machines 1, , , % Total 2, , , % 16 If a single gaming machine offers games of different categories the machine is counted as the highest category of game offered. For example if a gaming machine offers B2 and B3 content for the purpose of regulatory returns it is counted as a B2 gaming machine. 17 Betting operators gaming machines may include B2 and B3 content. In line with the previous footnote, where a machine offers games of different categories the GGY is currently attributed to the highest category of game available. For example, GGY generated by B3 gaming machine content on a terminal which also offers B2 content will be reported as B2 GGY.

15 15 Fig 8: Off-course betting sector breakdown of GGY Machines OTC Self exclusions recorded by operators Table 22: Betting sector self exclusions (from 2009/2010 Self exclusions 11,424 16,342 20,823 27% Known breaches of self exclusion 4,033 8,468 10,467 24% Number of individuals who cancelled their self exclusion after minimum exclusion period 1,160 1,821 2,781 53% The number of people who have self excluded and the number of people who have cancelled their self exclusion may be lower than these figures as individuals may have self excluded from more than one venue or operator and thus been counted more than once. The number of breaches represents the number of separate incidents, rather than the number of individuals. Gambling where individuals were unable to prove their age Table 23: Betting sector underage challenges Challenged upon entry but unable to prove age Challenged when attempting to gamble but unable to prove age (from 2009/ , , ,517 7% 22,008 71,050 90,453 27%

16 16 Integrity in betting 210 cases of suspicious betting activity have been reported to the Commission between 1 September 2007 and 30 September 2011 (including 17 reports between 1 April 2011 and 30 September 2011). 125 of the 210 cases were reported by betting operators under licence condition 15.1 in the first instance with 85 coming from sports governing bodies, or other sources such as the media, the public or non-regulated operators. 135 cases have been closed. In 133 of those cases, the grounds for suspicion of criminal activity have not been substantiated and the Commission either closed the cases or passed them to the relevant sport s governing body with any action taken by the sport s governing body now completed. Of the remaining two, only one investigation resulted in criminal proceedings - a caution for cheating at gambling. The other led to the perpetrators losing their jobs and bets being voided. A breakdown of the activities involved in those 135 cases is provided below. Of the remainder, as at 30 September 2011, 29 cases are still at the preliminary assessment stage, 32 cases have been passed to the relevant sport s governing body for investigation and there are 14 active investigations in which the Commission is involved. Table 24: Suspicious betting activity (1 September 2007 to 30 September 2011) 18 Activity Total cases closed to 31 Cases closed 1 Apr 2010 to 30 Sept 2010 Cases closed 1 Oct 2010 to 31 Cases closed 1 Apr 2011 to 30 Sept 2011 Total cases closed to 30 Sept 2011 Bowls Boxing Cricket Darts Football Golf Greyhounds Horseracing Multi Non-sport Rugby league Snooker Specials - other Specials - TV/Awards Squash Tennis Unknown Closed cases may subsequently be re-opened or merged with other cases as new information comes to light. Accordingly numbers (including closed cases) may vary between publications.

17 17 Bingo Structure of the non-remote bingo industry As at 31 March 2011 there were 245 operators holding non-remote bingo licences. The sector is broken down as follows: Table 25: Number of premises by operator Organisation Total premises at 31 Gala Coral Group 267 Rank Group - Mecca Bingo Ltd 103 Top Ten Bingo 24 Cashino Gaming Limited 18 Park Holidays UK Limited 15 Carlton Clubs plc 14 Thomas Estates Limited 12 Independent/small operators 242* Total 695 *During 2010/11 the Commission requested gambling premises data from all licensing authorities in Great Britain in order to update its location database. All but 14 licensing authorities responded with updates and this information is used here where previously the Commission has published only estimates. The figures shown in table 25 for 31 March 2011 represent the number of premises licences issued and, in contrast to previous industry statistics figures, include split premises counted separately. This accounts for an increase in the number of bingo premises figures reported for some operators. Although only a single licence type, the bingo industry is made up of various types of businesses including large bingo clubs, holiday parks, working men s clubs and smaller high street venues. In this publication these venues are only included where they hold a premises licence. In recent publications the Commission has broken down premises into categories, such as converted AGCs or holiday parks, by consulting Industry stakeholders. However, as the Commission does not collect data on this type of distinction, and as smaller high street venues become more common (through conversions or new premises) such distinctions become less clear, it has been decided to discontinue such a categorisation of premises within this publication. General information about the bingo industry Bingo GGY, bingo turnover and the number of bingo employees have all reduced during 2010/11 compared to the previous year. Employees Table 26: Bingo sector employees Number of employees 15,917 15,443 14,952-3%

18 18 Bingo turnover Table 27: Bingo turnover Game type Bingo turnover Main stage bingo % Mechanised cash bingo % Prize bingo % Total 1, , , % Fig 9: Bingo turnover Main stage bingo games Mechanised cash bingo Prize bingo Table 28: Bingo GGY (participation fees) Game type Bingo gross gambling yield Main stage bingo % Mechanised cash bingo % Prize bingo % Total %

19 19 Fig 10: Bingo GGY Main stage bingo games Mechanised cash bingo Prize bingo Gaming machines in bingo clubs Table 29: Average gaming machine numbers Machine category Average number of gaming machines and terminals B3 2,458 3,132 3,175 1% B % C 14,395 12,894 12,545-3% D 1,965 1,667 2,082 25% Total 19,212 17,996 18,043 0% Table 30: Gaming machine GGY Machine category Gross gambling yield B % B % C % D % Aggregated categories* % Total % * Where GGY figures have been provided but not broken down by machine category.

20 20 Table 31: Bingo sector breakdown of GGY Revenue stream Bingo gross gambling yield Participation fee % Gaming machines % Total % Fig 11: Bingo sector breakdown of GGY Participation fees Gaming machines

21 21 Self exclusions recorded by operators Table 32: Bingo sector self exclusions Self exclusions Self exclusions % Known breaches of self exclusion Number of individuals who cancelled their self exclusion after minimum exclusion period % % The number of people who have self excluded and the number of people who have cancelled their self-exclusion may be lower than these figures as individuals may have self excluded from more than one venue or operator and thus been counted more than once. The number of breaches represents the number of separate incidents, rather than the number of individuals. Gambling where individuals were unable to prove their age Table 33: Bingo sector age challenges Challenged upon entry but unable to prove age 19 Challenged when attempting to gamble but unable to prove age 20 Underage challenges % % 19 Under 18s are allowed in licensed commercial bingo clubs but they must not take part in playing bingo or any other forms of gambling whilst on the premises. If a bingo club has category B or C gaming machines these must be separated from areas where under 18s are allowed. Although the law does not prevent under 18s from entering bingo clubs, the industry generally chooses to apply a no under 18s policy. 20 It is illegal for anyone under the age of 18 to gamble on a bingo premises.

22 22 Casinos Structure of the non-remote casino industry There were 149 casinos operating at 31 March Three companies own the majority of casinos in the industry, namely Genting UK (Genting Casinos) with 46 casinos, the Rank Group (Grosvenor Casinos and G Casinos) with 37 casinos and the Gala Coral Group (Gala Casinos) with 28 casinos. As at 31 March 2011, seven 2005 Act casino operating licences were held by operators and four of the sixteen local authorities permitted to issue 2005 Act casino premises licences had begun their competition processes. A number of other local authorities are expected to follow suit in the coming months. Table 34: Number of premises by operator Organisation Total casinos at 31 Total casinos Total casinos at 31 Total casinos at 31 March 2011 Rank Group (Grosvenor and G Casinos) Genting UK (Genting Casinos) Gala Coral Group (Gala Casinos) London Clubs International Other operators Total General information about the casino industry Employees Table 35: Casino sector employees Number of employees 13,321 13,619 13,598 0% Casino attendance Table 36: Casino attendance Scotland North Midlands & Wales South Customers (millions) Other London London high end* Total

23 23 Table 37: Average industry table numbers Game Tables 3 Card Poker % American Roulette % Blackjack % Casino Stud Poker % Dice % Electronic Roulette (player positions) 3,958 3,675 3,604-2% Punto Banco % Other* % Total 6,037 5,754 5,688-1% * includes new games, less common games, and player positions at electronic multigames terminals. Table 38: Casino drop 21 and win by region Region Scotland North Midlands and Wales South High end London* Other London Great Britain total Casinos operating Year Drop from previous year 21 Drop = money exchanged for gaming chips. Win/house win = amount retained by the casino. House win from previous year House win % 15 April to March 2010/ % % 15% 15 April to March 2009/ % % 16% 14 April to March 2008/ % % 16% 41 April to March 2010/ % % 15% 38 April to March 2009/ % % 15% 38 April to March 2008/ % % 14% 39 April to March 2010/ % % 15% 38 April to March 2009/ % % 15% 38 April to March 2008/ % % 14% 29 April to March 2010/ % % 16% 27 April to March 2009/ % % 15% 28 April to March 2008/ % % 16% 6 April to March 2010/11 1, % % 12% 6 April to March 2009/ % % 13% 6 April to March 2008/09 1, % % 15% 17 April to March 2010/11 1, % % 14% 17 April to March 2009/10 1, % % 15% 19 April to March 2008/09 1, % % 15% 147** April to March 2010/11 4, % % 14% 141** April to March 2009/10 4, % % 15% 143** April to March 2008/09 4, % % 15% * Six casinos identified by the National Casino Industry Forum (NCIF) - Crockfords, Aspinalls, Clermont Club, The Ritz, Les Ambassadeurs, Maxims Casino. ** The number of casinos that provide table games and therefore supply us with drop and win figures, ie those casinos that do not offer table games (card clubs) do not provide these returns.

24 24 Table 39: Total drop by game 22 Apr Apr American Roulette Gaming machines in casinos Table 40: Average gaming machine numbers Machine category Blackjack Trial and other Games Casino Stud Poker Dice Number of machines and terminals Punto Banco B1 2,477 2,441 2,477 1% B % B % Total 2,527 2,478 2,510 1% Three Card Poker Electronic Roulette Electronic Multigame 2, , , , Total Table 41: Gaming machine GGY Machine category Gross gambling yield B % B % B % Aggregated categories* % Total % * Where GGY figures have been provided but not broken down by machine category. Table 42: Total casino GGY Machine category Gross gambling yield Casino games % Machines % Total % 22 The totals in table 39 are lower than those in table 38 because of false drop, which is drop exchanged for plaques at the cash desk and converted into chips at the table but not then used. This is only recorded for major players and the value is included in the total drop but is not attributable to any game.

25 25 Fig 12: GGY casinos Casino games Machines Location of casinos Table 43: 1968 Act casino permitted areas premises operating under a non-remote casino licence Licensing Area at 31 Mar 2010 at 31 Mar 2011 Licensing area at 31 Mar 2010 at 31 Mar 2011 Licensing Area England England England at 31 Mar 2010 Birkenhead 1 1 Luton 3 3 Stoke-on-Trent 2 2 Birmingham 7 7 Manchester 6 6 Sunderland 1 1 Blackpool 2 2 Margate 1 1 Teesside 1 1 Bolton 2 2 Newcastle-upon-Tyne 3 3 Torbay (Torquay) 1 1 Bournemouth 2 2 Northampton 3 3 Walsall 1 2 Bradford 2 2 Nottingham 5 5 West Bromwich 1 1 Brighton 3 3 Plymouth 2 2 Wolverhampton 2 2 Bristol 3 4 Portsmouth & Southsea 2 3 Coventry 3 3 Ramsgate 1 1 London Derby 2 2 Reading 2 3 Dudley 1 1 Ryde 0 0 Wales Great Yarmouth 3 3 Salford 2 2 Cardiff 3 3 Hove 1 0 Scarborough 1 2 Swansea 2 2 Huddersfield 1 2 Sheffield 3 3 Kingston-upon-Hull 2 2 Southampton 3 3 Scotland Leeds 5 5 Southend-on-sea 3 3 Aberdeen 4 3 Leicester 3 3 Southport 1 1 Dundee 2 2 Liverpool 3 4 Stockport 2 2 Edinburgh 4 4 * This includes two premises that do not offer table games. at 31 Mar 2011 Glasgow 5 6 Total number of operating casinos *

26 Act casinos Under Section 175(4) of the Gambling Act 2005, 16 local council (licensing authority) areas were determined as potential locations for casinos, as follows: One large casino can be permitted to be licensed in Great Yarmouth, Kingston-upon-Hull, Leeds, Middlesbrough, Milton Keynes, Newham, Solihull and Southampton. One small casino can be permitted to be licensed in Bath and North East Somerset, Dumfries and Galloway, East Lindsey, Luton, Scarborough, Swansea, Torbay and Wolverhampton. As at 31 March 2011 no small or large casinos had opened (although the large casino in Newham subsequently opened in December 2011) Act casinos - licences not operational as at 31 March 2011 At 31 March 2011, there could have been a theoretical maximum of Act casinos, comprising 149 casinos operating, 13 casinos licensed but subsequently closed, 27 casinos licensed but not yet operating, but minus three replacement licences. Three casinos which specialise in card room activities are included in the total Act casino permitted areas Areas in which the licensing of premises for casino gaming under the 1968 Act is permitted showing the number of licensed casinos operating on 31 March 2010 and 31 March 2011 are given below. New licences for 1968 Act casinos are no longer issued. Self exclusions recorded by operators Table 44: Casino sector self exclusions Self exclusions Self exclusions 6,081 6,243 6,684 7% Known breaches of self exclusion Number of individuals who cancelled their self exclusion after minimum exclusion period % 868 1,331 1,456 9% The number of people who have self excluded and the number of people who have cancelled their self-exclusion may be lower than these figures as individuals may have self excluded from more than one venue or operator and thus been counted more than once. The number of breaches represents the number of separate incidents, rather than the number of individuals. Gambling where individuals were unable to prove their age Table 45: Casino sector age challenges Challenged upon entry but unable to prove age Challenged when attempting to gamble but unable to prove age Underage challenges % %

27 27 Gaming machines, including arcades Structure of the gaming machine and arcade industry There were 570 Adult Gaming Centre (AGC) licences and 235 Family Entertainment Centre (FEC) licences held by operators as at 31 March There were 69 licences to manufacture gaming machines or gaming machine software and 543 gaming machine supplier licences held under either the Gambling Act 2005 or Section 27 of the 1968 Act. Table 46: Number of arcade premises Arcade type Number of premises as at 31 March 2011* Adult Gaming Centre (AGC) 2,103 Family Entertainment Centre (FEC) * During 2010/11 the Commission requested gambling premises data from all licensing authorities in Great Britain in order to update its location database. All but 14 licensing authorities responded with updates and this information is used here where previously the Commission has published only estimates. These figures may include split premises. Table 47: Number of licences - gaming machine manufacturers, suppliers, AGCs and FECs at 31 at Act Section 27 certificate holders Act Machine suppliers Sub total of above Machine manufacturers Adult Gaming Centre (AGC) Family Entertainment Centre (FEC) Figure 13: Breakdown of the Commission-licensed arcade sector market share by GGY market share (2010/11) FEC 19% AGC 81% Some manufacturers also supply machines (and may hold both licences). For the purpose of this section operators have been associated with the category (manufacturer or supplier) that best captures their business model. 23 Will only include those FECs licensed by the Gambling Commission, excludes those requiring only a permit from local licensing authorities. 24 Section 27 certificate holders must apply for an operating licence under the 2005 Act when their certificate expires.

28 28 Gaming machine manufacturers The primary business of machine manufacturers is the design and manufacture of machines and new game concepts for machines in categories B D, including cranes and pushers. Larger manufacturers are identified as those with the greatest GGY between 1 April 2010 and 31 March 2011: Astra Novomatic Barcrest 25 /IGT Bell Fruit (Danoptra) Gaming machine suppliers The primary business of machine suppliers is the supply and maintenance of gaming machines on behalf of the operator, usually on a rental basis. Larger suppliers are identified as those that supplied the greatest number of machines 26 to operators between 1 April 2010 and 31 March 2011: AMG Leisure Limited Claremont Automatics Ltd Crown Leisure Limited Dransfield Novelty Company Ltd Gamestec Leisure Limited Global draw Inspired Gaming (UK) Limited RLMS Sales Limited Sceptre Leisure Solutions Limited Wessex Coin Ltd General information about the gaming machine and arcade industries Number of employees Table 48: Gaming machine sector employees Licence type Number of employees AGC 12,693 13,032 11,198-14% FEC 27 3,806 3,222 2,638-18% Gaming machine and software manufacturer 1,662 2,005 1,800-10% Gaming machine supplier 8,205 6,673 6,159-8% Total 26,366 24,932 21,795-13% 25 Barcrest is now owned by Global Draw and is no longer linked to IGT. 26 Including dedicated/greened machines, terminals or games. 27 Will only include those FECs licensed by the Gambling Commission, excludes those requiring only a permit from local licensing authorities.

29 29 Gaming machines in AGCs and FECs Table 49: Average AGC machine numbers Machine category B3 10,018 9,359 8,189-13% B % C 42,373 36,367 30,006-17% D 19,709 19,220 17,267-10% Total 72,293 65,112 55,649-15% Table 50: AGC machine GGY Machine category B % B % C % D % Aggregated categories* % Total % * Where GGY figures have been provided but not broken down by machine category. Table 51: Average licensed FEC machine numbers Machine category C 3,491 2,954 2,763-6% D 27,521 25,823 23,537-9% Total 31,012 28,777 26,300-9% Table 52: Licensed FEC GGY Machine category C % D % Aggregated categories* % Total % * Where GGY figures have been provided but not broken down by machine category.

30 30 Self exclusions recorded by operators Table 53: Sector self exclusions Licence type Self exclusions (from 2009/2010 Self exclusions AGC 2,709 3,031 2,972-2% FEC % Known breaches of self exclusion AGC % Number of individuals who cancelled their self exclusion after minimum exclusion period FEC % AGC % FEC % The number of people who have self excluded and the number of people who have cancelled their self exclusion may be lower than these figures as individuals may have self excluded from more than one venue or operator and thus been counted more than once. The number of breaches represents the number of separate incidents, rather than the number of individuals. Gambling where individuals were unable to prove their age Table 54: Arcade sector age challenges Challenged upon entry but unable to prove age* Challenged when attempting to gamble but unable to prove age *Children are allowed in FECs. Licence type Self exclusions (from 2009/2010 AGC 7,440 12,880 13,949 8% AGC % FEC (adult area) %

31 31 Lotteries Lotteries Structure of the lotteries industry As at 31 March 2011, there were a total of 447 society lottery (SL) operators holding 621 lottery licences. Those licences comprised 443 non-remote lottery operating licences and 178 remote lottery operating licences. A society is defined as non-commercial if it is organised for charitable, sporting, cultural or other purposes apart from private or commercial gain. Societies may employ a licensed external lottery manager (ELM) to promote all or part of their lottery on their behalf. As at 31 March 2011, there were 29 ELMs holding 40 licences. Those licences comprised 25 non-remote ELM operating licences and 15 remote ELM operating licences. Table 55: Lottery licences Licence Type at 31 at 31 Society lotteries Non-remote Remote ELMs Non-remote Remote General information about lotteries The lottery sector has recorded growth year on year since 2008/09. During 2010/11 the total proceeds taken from society lotteries increased by 7% compared to the previous year whilst the proportion of lotteries managed by ELMs has also grown. Society lotteries Table 56: Total lottery proceeds, expenses and prizes (includes ELM managed lotteries) Prizes from proceeds* % Expenses % Balance (to good causes) % Total proceeds % *Excludes prizes from rollovers.

32 32 Fig 14: Monthly lottery proceeds Society lotteries managed by external lottery managers As an ELM operates on behalf of a society lottery, the proceeds from ELM lotteries presented below represent a subset of the total proceeds shown in table 56 (they are not additional proceeds). Table 57: ELM managed lottery proceeds, expenses and prizes 28 ELM managed lotteries Employees Table 58: ELM employees Prizes from proceeds* % Expenses % Balance (to good causes) % Total proceeds % *Excludes prizes from rollovers. Number of employees % Gambling where individuals were unable to prove their age There were no incidents recorded by ELMs or Society Lotteries when someone who attempted to gamble, or gambled, when challenged was unable to prove their age. 28 Does not include those ELM managed lotteries registered with local authorities

33 33 Remote betting, bingo and casino Remote gambling industry The estimates provided in tables 59 and 60 below are provided courtesy of H2 Gambling Capital ( It is estimated that global remote gambling GGY (excluding telephone betting) was 18 billion during 2010, which represents 23% growth since UK consumer GGY (includes GGY generated with operators regulated overseas), which includes telephone betting, is also estimated to have grown 23% between 2008 and 2010 to reach 1.9 billion. Table 59: The global remote industry (excludes telephone betting) 29 Jan Dec 2008 Jan Dec 2009 Jan Dec to 2010 GGY 14,880 16,670 18,270 10% Table 60: The UK consumer remote industry Jan Dec 2008 Jan Dec 2009 Jan Dec to 2010 GGY 1,580 1,760 1,940 10% Structure of the British licensed remote gambling industry The remote gambling industry in Great Britain, which includes both UK and overseas consumer activity conducted in reliance on a Commission licence, is made up primarily as follows: some of the large and familiar high street bookmakers that offer remote gambling (for example, Gala Coral Group) large remote-only operators smaller betting operators that operate remote gambling facilities themselves smaller betting operators that have their remote operations hosted by third parties fantasy football style remote pool betting operators smaller remote-only bingo and casino operators that do not offer any premises based gambling businesses supplying gambling software to gambling operators. As at 31 March 2011 there were 291 remote gambling activity licences held by 225 operators. Table 61: Breakdown of remote gambling activities licensed by the Commission Activity at 31 at 31 Gambling software General betting (real events) General betting (virtual events) Pool betting General betting (telephone) Casino Betting intermediary (trading room only) Betting intermediary 11 9 Bingo 12 8 Total Figures were originally provided in Euros: billion, billion, billion (1 EUR = GBP). This estimate excludes telephone betting, which is thought to be an additional billion per annum. 30 This category of licence was introduced on 1 August 2009 and resulted in the previous licence activity being split between real and virtual events. Going forward, the Commission will be reporting these licence numbers separately rather than combined as in the 2009/10 industry statistics. 31 In the 2009/10 industry statistics betting intermediary (trading room only) and betting intermediary licence holders are reported as one figure. This and future industry statistics will report these licence activities separately.

34 34 General information about remote betting, bingo and casino In the last two years since 2008/9 Commission regulated GGY (which includes both UK and overseas consumer activity conducted in reliance on a Commission licence) has decreased by 19% due to the relocation of significant UK brands overseas. The 5% increase in the GGY of Commission regulated operators in the last 12 months is primarily attributable to growth by existing operators rather than new entrants to the market. We expect the GGY from Commission licensed operators to decline in the future as the effect of Betfair moving offshore is seen in regulatory return data. Further relocations of operators overseas cannot be ruled out. Table 62: Remote sector turnover excluding betting exchanges 32 Betting 10, , , % Bingo % Casino % Total 11, , , % Fig 15: Remote sector turnover excluding betting exchanges Bingo Betting Casino 32 Figures only relate to UK operators licensed by the Commission who are operating in remote markets.

35 35 Gross gambling yield Table 63: Remote sector GGY including betting exchanges General Betting % Betting Exchange % Bingo % Casino % Total % Fig 16 GGY from remote gambling activities (including betting exchanges) Bingo Betting exchange Casino General betting General information about remote betting, bingo and casino Employees Table 64: Remote sector employees Number of employees 8,918 7,233 6,387-12%

36 36 Customer accounts Table 65: Number of customer accounts and funds held Customer accounts (for Commission licensed facilities) millions Active customer accounts millions New player registrations millions Funds held in customer accounts Self exclusions recorded by operators Table 66: Remote sector self exclusions Self exclusions Self exclusions 46,359 39,761 35,275-11% Known breaches of self exclusion Number of individuals who cancelled their self exclusion after minimum exclusion period 7,198 7,444 2,619-65% 1,540 1,483 1,656 12% The number of people who have self excluded and the number of people who have cancelled their self exclusion may be lower than these figures as individuals may have self excluded from more than one site or operator and thus been counted more than once. The number of breaches represents the number of separate incidents, rather than the number of individuals. Gambling where individuals were unable to prove their age % % % % Table 67: Remote sector age challenges Challenged when attempting to gamble but unable to prove age Underage challenges %

37 37 Appendix 1 Appendix 1 Regulatory returns analysis (methodology) Regulatory returns must be completed annually by most operators and quarterly by some operators (the large betting operators, casino and remote operators). The date on which returns fall due depends on the date chosen by the particular licence holder, for example, it may coincide with an organisation s own reporting cycle, may be on an annual calendar year basis or run from 1 September to 31 August in line with the date that the 2005 Act came into force. In addition: annual regulatory returns must be submitted within 42 days of the date on which the return falls due quarterly returns must be submitted within 28 days of the date on which the return falls due lottery submissions must be made within 90 days of a draw being made or of the last scratch-card being sold. This means that in some instances the Commission has had to provide estimated figures for the period 1 April 2010 to 31 March The diagram below indicates how we make that estimation. When providing figures covering a particular period, the Commission includes all returns that fall wholly or partially within that reporting period. For each operator that submits an annual return, a weighted average is calculated based on the number of days each of the two returns relates to the reporting period. No such calculation is required for quarterly submitted returns as they fall wholly within the reporting period. Where an operator s annual returns cover only part of the period in question the figure has been adjusted to produce an estimate for the full year. For example, an operator with a reporting year running to 31 December will not yet have provided data for the latter three months of the period 1 April 2010 to 31 March 2011 (return due 11 January 2012); in this case the annual figures on the return to 31 December 2010 have been taken as a proxy for the full calendar year.. Regulatory returns covering 1 April 2010 to 31 March days Regulatory returns covering 90 days Regulatory returns covering 275 days Regulatory returns covering 90 days (estimated) Regulatory returns covering 1 January 2010 to 31 December days Regulatory returns covering 1 January 2011 to 31 December 2012 not yet due 1/1/2010 1/4/ /12/2010-1/1/ /3/ /12/20112 Merger acquisitions are commonplace in some sectors of the gambling industry. This could result in some duplication of data provided in regulatory returns.